Scherer Smith & Kenny LLP serves mid-sized and fast-growing entrepreneurial companies. From complex litigation to business, real estate, intellectual property and employment law, our team brings strategic thinking, pragmatism and intense dedication to our clients’ success. Partner NotesAbout five years ago, a good friend of mine introduced me to fly fishing for steelhead with a two-handed – or “Spey” – rod. I have been fly fishing in California for a little over a decade, and I had no idea then that I was about to enter such new areas of specificity, gear, patience, and camaraderie. Steelhead are anadromous rainbow trout. They are genetically identical to rainbow trout with the exception that, after a year or two in the river, they run to the ocean. They return to the river for between the next one to five years to spawn, but unlike salmon they may not die but instead go back to the ocean to then repeat the cycle the next year. Steelhead are native only to the coastal waters and rivers spanning from Baja to northeast Asia. (Like many fish, they have been moved and planted around the world, including the Great Lakes. But as we snobby west coasters like to say, “No salt, no steel.”) Each fish also returns to spawn in the particular river it was born in, giving the fish from different rivers different unique characteristics. Spey casting for steelhead involves using long – typically eleven to thirteen feet – two-handed fly rods. The cast – which uses motions like the “snap T,” “double Spey,” “Perry poke,” and “snake roll” – is art when done well. Using that analogy to describe my own current casting form and dating myself, I would say I’m the equivalent of a high school junior who can draw a decent “Metallica” logo on his Trapper Keeper. In Spey casting, the tip of the fly line is made of interchangeable weights in order to get the fly down to different depths in the water column. After the cast, the fly swings through the current and draws tight at the end of the swing. If you’re lucky enough to hook a fish (steelhead are the “fish of a thousand casts”), you feel it immediately – it’s a jolt of electricity after seven hours of silence. A hooked fish typically comes out of the water jumping multiple times as you try to land them. If you can get one to hand, they are, in my opinion, the most beautiful freshwater fish. Depending on the river, they will be either deeply colored like a giant rainbow trout or may remain silvery and chrome the entire time they’re in the river. I recently was lucky enough to travel up to (as my mother-in-law would say, “true”) Northern California for a long weekend of steelhead fishing. Two good friends – including the one that introduced me to Spey casting – and I spent three days exploring deep river valleys and runs looking for water that would hold fish and was ideal for Spey casting. We didn’t land any adult fish, but we got quite a few “half pounders” – smaller juvenile steelhead that are unique only to a few rivers in Northern California and southern Oregon. There was a lot of banter and casting critiques, but also long periods of silence. On the third morning, we stood together in a rainstorm slowly moving down a riffle as the temperature rose from the 40s into the 50s. We saw river otters, bald eagles, osprey, and plenty of deer; encountered some expansive generational estates that would suddenly appear on dirt roads around river bends in the middle of nowhere; and ran into plenty of characters in small towns and boat ramps. Growing up in Indiana, I never envisioned myself living in California – much less developing such a passion for a niche hobby like this that is very specific to where I now live. I think there’s a lot that draws me to it, including the remote areas where steelhead are found (and accompanying lack of cell reception), the gear, and the natural beauty inherent in where you fish. I think it also delivers more purely the meditation that a lot of people believe traditional fly fishing does. Fly fishing for trout in the classic way – with dry flies and single-hand rods – is also relaxing, but it’s much more active and engaging. You’re constantly reading water, changing or losing flies, and trying to figure out how to get a cast to that spot across the river. Spey casting for steelhead removes a lot of these decisions: once you get comfortable with the casting motion, you cast, wait for your fly to swing, pull in the line, take two steps down river, and repeat – for maybe the next two hours before you move to a new spot. I now look forward in a different way to late summer and fall of each year – the typical beginning of the steelhead season – and feel fortunate to get to continue to explore this hobby and the encounters and people it will introduce me to. - Written by Ryan W. Stahl ALERT:NEW Reporting Requirement FOR U.S. COMPANIES Coming in 2024 Attention Corporate and LLC Clients: Effective January 1, 2024, there are new corporate reporting requirements for corporations and LLCs in the United States under the Corporate Transparency Act. Beginning on January 1, 2024, both domestic U.S. companies and foreign companies doing business in the United States will need to comply with reporting requirements under the Corporate Transparency Act (“CTA”) by providing information about their beneficial owners to the Financial Crimes Enforcement Network (FinCEN). FinCEN is a bureau of the U.S. Department of the Treasury. The new reporting requirements were implemented to address corruption in the use of shell and front companies. According to FinCen, lack of transparency in corporate ownership “…hurts ordinary Americans because [it] results in an uneven playing field for honest and legitimate U.S. businesses.” Who Will Need to Report The CTA applies to most domestic (and foreign) companies, including corporations and limited liability companies. Exemptions are limited and extend mainly to companies that are already heavily regulated (i.e., regulated public utilities, venture capital fund advisors, investment companies, large operating companies, etc.). Importantly, there is no small business exception to the reporting requirements, so many of our clients will be impacted by this new regulation. Employment Case Law Alerts:On September 8, 2023, the California Court of Appeal, in a case entitled Doe v. Superior Court of San Francisco (No. A167105) issued another decision constraining an employer’s ability to enforce binding arbitration agreements against employees. The decision compliments a July 2023 Court of Appeal opinion, Cvejic v. Skyview Capital, LLC (2023) 92 Cal.App.5th 1073. Both opinions address the requirements of California Code of Civil Procedure, Section 1281.98(a)(1) which provides that the employer seeking to enforce a binding arbitration agreement must demonstrate that it “paid” all fees unique to arbitration within 30-days after the due date; otherwise, the employer is considered to be in material breach of the arbitration agreement and waives its right to compel arbitration. In Doe, the Court addressed the meaning of “paid” under Section 1281.98(a)(1), finding that the employer’s failure to deliver the necessary funds to the arbitrator by or before the 30th day after the issuance of the arbitration invoice, violated the statute even though the employer proved (via a postmark) that it mailed a check for all fees before the deadline. In other words, the Court rejected the proverbial “the check is in the mail” excuse even though the excuse was actually proven true! Similarly, in the Cvejic opinion, the Court of Appeal rejected the employer’s tardy payment of fees even though the arbitrator had extended the payment deadline. The Court held that employer’s obligations to meet the arbitration deposit payment deadline under Section 1281.98(a)(1) is jurisdictional and cannot be waived or extended except by mutual agreement of the parties. Another Example of Why California Employers Must Be Careful With Their Onboarding DocumentsIn Alberto v. Cambrian Homecare (2023) 91 Cal.App.5th 482, a headline-grabbing April 2023 decision, the California Court of Appeal affirmed a trial court’s ruling invalidating an employee’s arbitration agreement. Notably, the Court found three separate provisions contained within three separate agreements signed by the employee in their hiring / onboarding materials—the arbitration agreement and two confidentiality agreements—as evidence of irreparable unconscionability in the arbitration agreement. The subject provisions found unlawful by the Court were (1) a clause in the arbitration agreement providing the employer a unilateral right to seek injunctive relief against the employee in court without the need to post a bond, (2) a provision in the confidentiality agreement prohibiting the employee from disclosing to or discussing with others wages and working conditions (a direct violation of California Labor Code Section 232), and (3) a wholesale waiver of all California Labor Code Sections 2698 et seq. Private Attorney General Act (“PAGA”) claims in any forum (arbitration and court) contained in an addendum to the confidentiality agreement. |